Expert Witness Profiler

Tag: Lease

  • Law and Legal Expert Was Not Allowed to Opine on Alleged Obligations

    Law and Legal Expert Was Not Allowed to Opine on Alleged Obligations

    Plaintiffs are alleged owners of real property containing natural gas who have no leases with EQT covering their interests. Claiming that EQT has produced gas from Plaintiffs’ properties but not paid them for it, Plaintiffs brought this putative class action seeking to recover the alleged non-payment on behalf of all allegedly unpaid tenants-in-common who presently own property with a co-tenant who has a lease with EQT. Their complaint sought damages for the alleged non-payment on the non-contractual causes of action one might expect from those who are not parties to leases—quantum meruit, conversion, and unjust enrichment—and tacks on a purported claim under Pennsylvania’s Guaranteed Minimum Royalty Act (“GMRA”).

    EQT filed motions to exclude and strike the opinions of two of Plaintiffs’ experts, Cara Davis and Christopher L. Haney.

    Law And Legal Expert Witness

    Cara C. Davis has had 15 years of experience, devoted entirely to the oil and gas title industry and has personally prepared and reviewed hundreds of title abstracts and rendered numerous certified title opinions based on both [her] own work and that of others.

    Additionally, Davis is licensed to practice law in Pennsylvania and Ohio and her experience includes evaluating title defects, identifying and assisting with unknown heirs, and tracing mineral ownership, all of which are directly relevant to the identification and location of unleased co-tenants.

    Want to know more about the challenges Cara Davis has faced? Get the full details with our Challenge Study report.

    Accounting Expert Witness

    Christopher L. Haney is a certified public accountant (“CPA”), a certified fraud examiner (“CFE”) and certified in healthcare compliance (“CHC”).

    Haney is regularly retained as an expert and has testified in a variety of venues on topics including financial damages, data analysis, statistical sampling, and regulatory compliance.

    Get the full story on challenges to Christopher Haney’s expert opinions and testimony with an in-depth Challenge Study.

    Discussion by the Court

    Cara Davis

    EQT asserted that Davis did not adequately review and tailor [her opinions] to the record facts of the case, her opinions are not grounded in the facts, her opinions are unhelpful to the trier of fact on class certification and her opinions were offered in relation to a prior class certification definition that Plaintiffs have now abandoned.

    Analysis

    Based on Davis’ experience in the industry, along with the additional expert reports in the record, the Court found that Davis’ opinion is reliable. The methodology Davis described, both in her report and throughout her testimony, is a practice which she has employed throughout her career and is “generally accepted” in the industry. Davis also relied on several relevant sources in preparing her report.

    There is a clear connection between Davis’ opinion and the facts at issue. Davis formed her opinion based on the facts provided in the record. She used testimony that led her to believe that EQT employs “standard title practices” and applied relevant data she obtained from excel sheets. She determined, in her “professional experience,” that the identities of the unleased co-tenants and their locations are ascertainable through “diligent title search,” which is an accepted method used throughout the industry.

    EQT additionally challenged Davis’ opinions that EQT is obligated “to identify and locate unleased co-tenants in accordance with the requirements of the Pennsylvania Minimum Royalty Act, 58 P.S. § 33.3.” The Court agreed with EQT that Davis’ opinions, particularly regarding obligations stemming from § 33.3, shall be excluded.

    Davis states in her deposition that she only “vaguely” remembers when the language of the 58 P.S. § 33.3 came out, she does not remember why the statute was passed, she has not read the legislative history, and she did not read the legislative intent behind the statute. As a result, Davis’ testimony that § 33.3 “imposes an obligation on EQT to identify unleased co-tenants” is inadmissible.

    Christopher Haney

    EQT filed a motion to exclude Haney’s expert opinions, asserting “they are unreliable, irrelevant, and misleading.”

    Plaintiffs retained Haney, requesting that he (1) “organize and compile EQT’s data into a structured data set that can be efficiently queried based on select criteria,” (2) use that structured data set to evaluate whether select identifying information for Plaintiffs and other unleased owners (i.e., potential class members for this litigation) can be identified (3) “evaluate acceptable damages methodologies for this matter,” (4) “evaluate the methodology employed by EQT for calculating natural gas royalty payments,” and (5) “determine whether the data available in documents produced by EQT would enable the calculation of natural gas payments or royalties using EQT’s methodology.”

    Analysis

    Haney explained his process and conclusions throughout his report. He also identified an itemized list of sources and information that he relied upon in support of his methodology. Though Haney testified “that he was unable ‘to incorporate all of the data into the database’ from EQT’s records,” Haney was able to compile most of the data apart from the tax parcel identification numbers that were contained in EQT’s Setup Files.

    Haney emphasized that he used “widely accepted statistical procedures and equations” when designing and executing his Statistically Valid Random Sampling method.

    The Court found that Haney had good grounds to rely on the data and information provided by counsel when forming his opinions.

    Haney used a reliable methodology. He used EQT’s established uniform method for calculating royalties owed to all owners regardless of whether they are parties to a lease.

    Held

    • The Court granted in part and denied in part Defendant EQT’s motion to exclude the expert opinions of Cara Davis.
    • The Court denied Defendant EQT’s motion to exclude the expert opinions of Christopher Haney.

    Key Takeaway

    When an expert relies solely or primarily on experience, he must explain how that experience leads to the conclusion reached, why that experience is a sufficient basis for the opinion, and how that experience is reliably applied to the facts.

    Case Details:

    Case Caption: Ross V. EQT Corporation
    Docket Number: 2:21cv1585
    Court Name: United States District Court, Pennsylvania Western
    Order Date: May 18, 2026
  • Accounting Expert Was Allowed to Opine on the Lease Auditing Process

    Accounting Expert Was Allowed to Opine on the Lease Auditing Process

    600 Cleveland owned a commercial office building located at 600 Cleveland Street, Clearwater, Florida 33601 from September 9, 2013, to April 1, 2024. Bank of America, N.A. (BANA) and 600 Cleveland assumed a lease agreement originally entered into by other parties on December 1, 1986, and both were bound by the agreement. This lawsuit arises from purported violations of the parties’ lease agreement (“Lease”). BANA counterclaimed that 600 Cleveland overcharged BANA for its share of Common Area Maintenance (“CAM”) under the Lease.

    600 Cleveland filed a motion to exclude the entire expert report of Tracy P. Chelepis (“Chelepis Report”) and to bar him from testifying at the upcoming bench trial. The Chelepis Report relates to an audit performed by Chelepis’ firm, which found that 600 Cleveland overcharged BANA for CAM fees under the Lease by $160,882.01.

    Accounting Expert Witness

    Tracy P. Chelepis holds a Bachelor of Science in accounting from the University of Kansas where he took multiple classes on auditing, a CPA license for which he attends 80 hours a year in continuing education, and a real estate license as both agent and broker for which he also attends mandatory continuing education.

    Chelepis also worked as an accountant for a major accounting firm performing financial statement audits and then spent years as a construction accountant for AT&T.

    Want to know more about the challenges Tracy Chelepis has faced? Get the full details with our Challenge Study report.

    Discussion by the Court

    600 Cleveland made three arguments: (1) Chelepis’ methodology is unreliable; (2) his opinion is ipse dixit; and (3) his testimony would not help the trier of fact.

    Cleveland argued that Chelepis should be barred from testifying because “lease auditing” does not have “articulated industry standards,” “peer review processes,” or a “regulatory governing body to which his opinions can be tested.” Cleveland contended that Chelepis’ reliance on his knowledge and experience as a CPA, purportedly without further explanation, rendered his methodology unreliable.

    BANA correctly identified that, for non-scientific expert testimony, there need not be articulated industry standards, peer review processes, or a regulatory governing body. Nor did the fact that Chelepis’ methodology required him to interpret terms in the lease to determine whether certain costs were properly included make his opinion inherently unreliable.

    Chelepis’ deposition testimony also undermined 600 Cleveland’s argument that his opinion is ipse dixit. Chelepis explained at length the general process he used to audit leases. He then reviewed the lease’s provisions and amendments and explained how he interpreted and applied them to reach his opinion. Chelepis similarly explained his accounting calculations and his underlying reasonable assumptions.

    The Court concluded that Chelepis’ testimony would be helpful in navigating the numerous financial records and reconciling them, using accounting principles, with the lease’s guidance for what could properly be charged as operating costs.

    Held

    The Court denied 600 Cleveland’s Daubert motion to exclude the testimony of Tracy Chelepis.

    Key Takeaway

    The standards of scientific reliability, such as testability and peer review, do not apply to all forms of expert testimony and a district court may decide that non-scientific expert testimony is reliable based upon personal knowledge or experience.

    Case Details:

    Case Caption: 600 Cleveland, LLC V. Bank Of America, N.A.
    Docket Number: 8:24cv1652
    Court Name: United States District Court, Florida Middle
    Order Date: January 23, 2026
  • Leasing Experts Are Not Allowed to Define Industry Standards

    Leasing Experts Are Not Allowed to Define Industry Standards

    This case is a landlord/tenant dispute regarding a lease agreement between Plaintiff/landlord Trustees Main/270 and Defendants/tenants ApplianceSmart, Inc., and JANONE, Inc. The claims arise from Defendant ApplianceSmart’s failure to pay pursuant to a lease agreement, and Defendant JANONE’s obligations as guarantor under the lease.

    Plaintiff filed a motion in limine related to two witnesses Defendants intended to call at trial to discuss the mitigation issue: Tony Isaac and Virland Johnson. Isaac is a director and the Chief Executive Officer of Defendant JANONE and the director of the parent company of Defendant ApplianceSmart. He will testify to Defendants’ attempts to provide a replacement tenant, show Plaintiff failed to mitigate its damages, and testify regarding the value of Plaintiffs replacement lease as an offset to any claimed damages. Johnson, the Chief financial officer of Defendant JANONE and former Chief Financial Officer of the parent company of ApplianceSmart, will offer similar testimony.

    Plaintiff argued that Defendants did not disclose Isaac and Johnson as expert witnesses.

    Leasing Expert Witnesses

    Virland A. Johnson provided leadership and strategic direction while serving in C-Level executive roles in public and privately held companies such as Cultural Experiences Abroad, Inc., Fender Musical Instruments Corp., Triumph Group, Inc., Unitech Industries, Inc. and Younger Brothers Group, Inc. Johnson’s more than 25 years of experience is primarily in the areas of process improvement, complex debt financings, SEC and financial reporting, turn-arounds, corporate restructuring, global finance, merger and acquisitions and returning companies to profitability and enhancing stockholder value. Johnson holds a Bachelor’s degree in Accountancy from Arizona State University.

    Get the full story on challenges to Virland A. Johnson’s expert opinions and testimony with an in-depth Challenge Study. 

    Tony Isaac has invested in various companies, both private and public from 1980 to present. Isaac’s specialty is negotiation and problem-solving of complex real estate and business transactions. Isaac has served as a director of Live Ventures Incorporated since December 2011. Isaac graduated from Ottawa University in 1981, where he majored in Commerce and Business Administration and Economics.

    Want to know more about the challenges Tony Isaac has faced? Get the full details with our Challenge Study report. 

    Discussions by the Court

    Plaintiff urged the Court to prohibit Isaac and Johnson from offering any opinion testimony: (1) based upon standards within the commercial leasing industry; (2) that the Plaintiff’s actions in mitigation fail to comply with such standards; and (3) that the value of the replacement tenant lease (Plaintiff’s lease with AutoZone) retroactively offsets the rent not paid over the three years.

    Defendants countered that the witnesses’ familiarity with lease terms as lessees of numerous properties across the country, qualifies as permissible lay testimony, not expert testimony.

    Defendants proposed testimony about reasonableness of mitigation efforts and the value of the replacement tenant lease based on the witnesses’ “experiences as businessmen involved on a routine basis with the leasing of properties for their companies’ stores and their experience with landlords requiring or not requiring the sorts of extreme requirements that the Plaintiff demanded here.” 

    Analysis

    While Defendants insisted that the testimony will not be based on technical or other specialized knowledge, the Court held that Isaac and Johnson’s testimony, however, would be improper to the extent their testimony begins to apply their years of experience and specialized knowledge of the commercial leasing industry to define industry standards, conclude on the reasonableness of the Plaintiffs’ actions, or conclude a value of the replacement tenant lease. 

    However, the Court added that Isaac and Johnson could testify as to their personal knowledge and observations of the events in this case.

    Held

    The Court granted in part the Plaintiff’s motion in limine prohibiting Tony Isaac and Virland Johnson from offering any opinion testimony based upon standards within the commercial leasing industry, testimony that the Plaintiff’s actions in mitigation fail to comply with such standards, and any opinion that the value of the AutoZone lease retroactively offsets the rent not paid over the three years.

    Key Takeaways:

    • Lay Testimony vs. Expert Testimony: The Court made a clear distinction between lay testimony and expert testimony. Tony Isaac and Virland Johnson’s familiarity with lease agreements did not automatically qualify them as experts. The Court emphasized that specialized knowledge of the commercial leasing industry would fall under expert testimony, which requires formal disclosure.
    • Failure to Disclose Expert Witnesses: The Defendants did not disclose Isaac and Johnson as expert witnesses, which proved decisive. This non-disclosure led to the Court partially granting the motion in limine, preventing Isaac and Johnson from offering opinion-based testimony on critical aspects of the case.

    Case Details:

    Case Caption: Trustees Main/270 Llc V. Appliancesmart Inc. Et Al
    Docket Number: 2:22cv1938
    Court Name: United States District Court, Ohio Southern
    Order Date: May 4, 2025
  • Court Refused to Exclude Insurance Expert Witness’ Opinions on Insurance Availability

    Court Refused to Exclude Insurance Expert Witness’ Opinions on Insurance Availability

    This case stems from a dispute over a provision of a ground lease between Stewart Development, LLC and 111 Veterans Boulevard, LLC. Stewart owned Heritage Plaza, a Class A office building in Metairie, Louisiana but leases the land on which it sits pursuant to a ground lease. 111 Veterans took over this ground lease in 2017. A few years later, in 2022, Stewart listed Heritage Plaza for sale, and 111 Veterans expressed interest in purchasing the building. However, purchase negotiations ultimately fell through. The next year, on March 16, 2023, 111 Veterans defaulted Stewart for allegedly violating the ground lease. In the default letter sent to Stewart, 111 Veterans explained Stewart breached the ground lease for failing to maintain $110,700,000 of casualty insurance, the amount equal to the replacement cost of the building (less depreciation of 10%) with a $10,000 or less deductible.

    About three months after this letter was sent, Stewart filed this lawsuit seeking a declaratory judgment and alleging claims for breach of contract and Louisiana Unfair Trade Practice and Consumer Protection Act (“LUTPA”) violations. Stewart argues inter alia that 111 Veterans’ mandated amount of insurance coverage is not reasonably obtainable, that Stewart’s failure to obtain such coverage was not a violation of the ground lease, and that 111 Veterans breached the lease by placing Stewart in default. 111 Veterans argues inter alia that its required coverage is reasonably obtainable, and that Stewart did in fact breach the ground lease for failing to maintain such coverage.

    Stewart filed a motion to exclude the testimony of 111 Veterans’ insurance expert Timothy Gold under Federal Rules of Evidence 702 and 703 and Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579 (1998).

    Insurance Expert Witness

    Timothy Gold began his insurance career in 2005 and joined Hartwig Moss Insurance Agency in 2013. Gold holds both property and casualty as well as life, health and accident licenses.

    Get the full story on challenges to Timothy J. Gold’s expert opinions and testimony with an in-depth Challenge Study. 

    Discussion by the Court

    In his report, Gold provided the following opinions:

    • There were no indicators from the commercial insurance market of pending issues acquiring property or flood coverage in southeast Louisiana prior to landfall of Hurricane Katrina on August 29, 2005;
    • For the coverage periods of 2021- 2024, it has been possible to obtain replacement cost, special form property insurance coverage excluding coverage for the peril of windstorm, for a significant property risk with an insured value in excess of $100,000,000 at a reasonable market cost;
    • For the coverage periods of 2021-2024 it has been possible to obtain property insurance coverage for the peril of windstorm for a building with insured values in excess of $100,000,000 with coverage limits in excess of $10,000,000 at a market cost;
    • And the cell captive program and parametric insurance policy Stewart Development, LLC utilized do not comply with paragraph 3(g) of the Fourth Amendment of the Ground Lease agreement.

    Analysis

    Stewart advanced numerous arguments in support of excluding Gold’s testimony. Specifically, Stewart argued that Gold’s testimony on Stewart’s parametric wind policy should be excluded because Gold did not read Stewart’s policy. Stewart claimed that Gold’s testimony on Stewart’s captive cell policy should be excluded because it is a legal conclusion. Plaintiff alleged that Gold’s opinions on the local insurance market before and after Hurricane Katrina in 2005 are speculative and warrant exclusion because Gold did not work in the insurance industry until 2006.

    Moreover, Stewart claimed that Gold’s reliance on conversations with other industry brokers constitutes unreliable methodology for his opinions on insurance availability from 2021-2024. And Stewart asserted that Gold’s testimony is undermined by his failure to read the testimony of Eric Lowenstein, 111 Veterans’ corporate representative, and his misreading of key facts from the testimony of Jason Provenzano, 111 Veterans’ insurance broker, and Andrew Schutzman, president and owner of AMS Risk Management and Consulting, Inc.

    111 Veterans opposed Stewart’s motion. Basically, 111 Veterans argued that Gold’s opinions meet the requirements of Rule 702, Rule 703, and Daubert, and that Stewart’s concerns constitute fodder for cross examination, not reasons for exclusion under Rule 702. Defendants further argued that, because this is a bench trial, Stewart’s concerns can be explored during trial with the judge as the gatekeeper and trier of fact.

    The Court agreed with 111 Veterans. The purpose of a Daubert motion is “to ensure that only reliable and relevant expert testimony is presented to the jury.” 

    Held

    The Court denied Stewart’s motion to exclude Timothy Gold’s opinions and testimony.

    Key Takeaway:

    The Court is “capable of assessing the probative value of the evidence and the weight [the expert’s] testimony should be given.” Moreover, as 111 Veterans points out, cross examination is the proper vehicle for Stewart’s concerns. In conclusion, vigorous cross-examination, presentation of contrary evidence, and careful instruction on the burden of proof are the traditional and appropriate means of attacking shaky but admissible evidence.

    Case Details:

    Case Caption: Stewart Development, LLC V. 111 Veterans Boulevard, LLC
    Docket Number: 2:23cv2085
    Court: United States District Court, Louisiana Eastern
    Order Date: November 15, 2024
  • Land Use Expert Witness’ Testimony Regarding General Land Use and Development Industry Standards Rejected

    Land Use Expert Witness’ Testimony Regarding General Land Use and Development Industry Standards Rejected

    This federal diversity action arises out of a commercial lease agreement for a three-story building located at 2555 Park Boulevard in the City of Palo Alto, California (“City”). Plaintiff KJ-Park, LLC (“KJ-Park”) retained Erik Schoennauer, a land use consultant, to testify about land use entitlement and permitting procedures relating to the subject property. Defendants Match Group, Inc. and Match Group, LLC (collectively, “Match Group” or “Defendants”) filed a motion to exclude Schoennauer’s opinions.

    Land Use Expert Witness

    Erik Schoennauer draws upon 33 years of experience in local land use and redevelopment processes, public/media relations, community outreach, and political consulting to serve the clients of The Schoennauer Company. Moreover, he has a unique combination of experience, spending half his career in government service and the other half in private business, with extensive involvement inneighborhood and community affairs.

    Fortify your strategy by reviewing a Challenge Study detailing grounds for excluding Erik Schoennauer’s expert testimony. 

    Discussion by the Court

    Defendants Match Group movd to exclude Schoennauer’s opinions, primarily on the ground that his opinions are impermissible legal conclusions and that his opinions regarding KJ-Park’s alleged vested right with respect to the subject property are irrelevant. Additionally, Match Group argued that any probative value of Schoennauer’s opinions are “substantially outweighed by a danger of . . . confusing the issues, . . . wasting time, or needlessly presenting cumulative evidence,” and therefore are excludable under Federal Rule of Evidence 403. 

    Schoennauer’s opinions largely concern whether the circumstances presented give rise to KJ-Park’s alleged vested right in the subject property, or warrant the application of estoppel principles.

    Legal Conclusion

    Schoennauer proposed to testify that, in his opinion, KJ-Park received “authorizations” for use of the subject property exclusively as office space that “vested through approval of the site-specific RLUA and/or issuance of the Building Permit.” However, he may not properly testify or offer opinions about issues of law, including the legal interpretation or significance of documents or events, or what the law requires with respect to the vested rights doctrine or the doctrine of estoppel. 

    The Court concluded that Schoennauer’s opinions about whether KJ-Park obtained an alleged vested right, or whether estoppel principles apply, including his opinions regarding the settlement agreement between KJ-Park and the City, must be excluded.

    Relevance

    KJ-Park contended that Schoennauer should be permitted to testify regarding general land use and development industry standards and practices. The vested rights doctrine and principles of equitable estoppel concern the legal rights and obligations as between KJ-Park and the City. Therefore, KJ-Park cannot, as a matter of law, use the vested rights doctrine or equitable estoppel as theories by which to hold Match Group liable under the subject lease and guaranty.

    In conclusion, the Court is not persuaded that testimony regarding general industry standards and practices is necessary or relevant to understand the evidence with respect to any matters that remain to be tried.

    Held

    The Court granted Match Group’s motion to exclude Erik Schoennauer’s opinions.

    Key Takeaways:

    • Firstly, Schoennauer may not properly testify or offer opinions about issues of law, including the legal interpretation or significance of documents or events, or what the law requires with respect to the vested rights doctrine or the doctrine of estoppel. 
    • Finally, testimony regarding general industry standards and practices is not necessary or relevant to understand the evidence with respect to any matters that remain to be tried.

    Case Details:

    Case Caption: Kj-Park, Llc V. Match Group, Llc Et Al
    Docket Number: 5:23cv2346
    Court: United States District Court, California Northern
    Order Date: September 05, 2024
  • Court excludes the testimony of Mining Engineering Expert Witness for not being of sufficient assistance to the trier of fact in determining whether the coal was mineable or merchantable 

    Court excludes the testimony of Mining Engineering Expert Witness for not being of sufficient assistance to the trier of fact in determining whether the coal was mineable or merchantable 

    This legal dispute stemmed from American Carbon Corporation (ACC) allegedly breaching a lease granting exclusive mining rights for coal owned by Big Sandy in Pike County, Kentucky. ACC was allowed to mine the “Demised Coal,” defined as mineable and merchantable coal within the property boundaries. In return, ACC was obligated to diligently mine, pay royalties, and reimburse tax payments for the coal.

    The lease expired on February 1, 2021, and during the entire five-year term, ACC did not conduct any coal mining. ACC also failed to fulfill financial obligations such as paying minimum annual royalties, deficiency payments, or tax reimbursements to Big Sandy. Approximately three months post-expiration, ACC notified Big Sandy via email that it considered the Demised Coal unmineable and unmerchantable without a capital investment from Big Sandy, using this as justification to excuse itself from lease obligations. ACC consistently argued it was not obliged to perform duties due to the coal’s alleged unmineable and unmerchantable state. Subsequently, on October 25, 2021, Big Sandy initiated legal action in this Court, alleging three counts of breach of contract. The lawsuit sought pre-judgment and post-judgment interest along with attorneys’ fees.

    To support its position, ACC presented Bill Johnson as an expert. Big Sandy filed a motion for summary judgment as well as a motion to exclude Johnson’s testimony, citing ACC’s failure to disclose crucial information as required by Federal Rule of Civil Procedure 26(a)(2)(B)(ii). Big Sandy contended that Johnson’s expert opinions were unreliable, irrelevant, and lacked disclosed supporting evidence, urging the Court to exclude them.

    Big Sandy claimed ACC breached the Lease by failing to diligently mine the Demised Coal, pay deficiency payments, and reimburse tax payments related to the coal. Big Sandy sought summary judgment on the diligent mining claim, asserting that mineability and merchantability were objective inquiries under Kentucky law. They argued ACC did not use the alternative dispute process outlined in the lease and was estopped from contesting its mineability or merchantability claims due to earlier representations.

    Regarding deficiency and tax payments, Big Sandy argued no agreement excused these payments, seeking interest and attorney’s fees if successful. ACC countered that the coal was not mineable or merchantable without a substantial loan from Big Sandy, citing market turmoil and the pandemic. ACC argued that a March 7, 2017 email exchange provided notice that the coal was not mineable and merchantable, and formally altered ACC’s obligation to pay Big Sandy the royalties and tax payments. Additionally, ACC argued that an oral agreement, despite falling under the Statute of Frauds, could act as a waiver, excusing ACC from fulfilling its obligations.

    The Court ruled ACC’s belief in profitability was not relevant to mineability or merchantability. ACC admitted no physical conditions hindered mining. ACC points to no provision in the lease that excused its obligation to diligently mine the Demised Coal unless it would be unprofitable to do so.

    ACC had relied on Mark Jensen’s deposition, a corporate representative, to support an oral agreement related to minimum royalties. However, Jensen’s deposition didn’t explicitly mention an oral agreement to suspend deficiency or tax payments. Instead, he indicated an oral agreement tied to production forecasts and minimums based on an anticipated loan to restart the mine. ACC failed to clarify the impact of this on provision § 4.7 of the lease, which mandated deficiency payments if Production Royalties fell below the Minimum Annual Royalty.

    Even if there was an oral modification regarding minimum calculations, ACC didn’t explain how this alteration affected its obligation to pay deficiencies and taxes as per the lease. The link between the oral agreement on production forecasts and minimums and the modification of ACC’s payment obligations for deficiencies and taxes, as specified in the lease, remained unclarified in ACC’s Response.

    However, both parties acknowledged a disagreement over material facts, preventing a summary judgment on Big Sandy’s breach of contract regarding damages for the diligent mining claim. Consequently, the issue of damages was scheduled to be settled in subsequent proceedings, and no judgment favoring Big Sandy would be entered until resolution of the Plaintiff’s claim for damages.

    Mining Engineering Expert Witness

    Bill Johnson has a Bachelor’s degree in Mining Engineering from the University of Kentucky and holds Professional Engineer certifications in multiple states, including Kentucky. He is the owner of Mountain Professional Services—an engineering consulting firm. He worked in the coal industry as a Mine Manager and Engineer for 32 years. He has extensive managerial skills overseeing all facets of the Mining, Permitting, and Reclamation process.

    Discussions by the Court

    Big Sandy persisted in seeking the exclusion of Johnson’s opinion, citing several reasons. They argued that Johnson’s opinion relied on market conditions rather than the physical characteristics of the coal, thus applying an incorrect standard and rendering the opinion unhelpful to the fact-finder. Additionally, Big Sandy claimed that Johnson hadn’t conducted a proper calculation regarding the profitability of mining the Demised Coal, thereby lacking support for his opinion based on market conditions. They also alleged that Johnson’s conclusions were drawn from undisclosed documents that were withheld in violation of Civil Rules, and further asserted that the remaining parts of Johnson’s opinions, aimed at rebutting those of Big Sandy’s expert David Newman, lacked any substantiating evidence from the record.

    ACC defended Johnson’s opinions, asserting their reliability without the need for specific calculations. They argued that the lack of disclosures regarding the underlying data relied upon by Johnson was inconsequential, pointing out that Big Sandy hadn’t disclosed the underlying data from its expert witness. ACC emphasized that there was no attempt from Big Sandy to compel Johnson or the Defendant to provide additional information regarding the matter.

    The Court found that Johnson’s opinions weren’t considered in the summary judgment analysis, which would warrant granting the Motion to Exclude. ACC had only briefly referenced Johnson’s testimony in response to the Motion for Summary Judgment, highlighting a material dispute regarding damages that required separate proceedings. Although ACC mentioned Johnson’s concerns about the damage calculations based on David Newman’s report, no specific citations from Johnson’s report supported these claims upon review. Johnson’s report primarily stated an opinion that none of the coal in Newman’s calculations was mineable or merchantable due to coal pricing and recovery percentages during a specific timeframe. ACC’s assertion of Johnson raising legitimate issues regarding damage calculations did not align with the content of Johnson’s report.

    ACC had acknowledged that it wasn’t contending any defects rendered the Demised Coal unmineable or unmerchantable. They clarified that profitability wasn’t a factor in determining the coal’s mineability or merchantability according to Kentucky standards. This acknowledgment led to the conclusion that Johnson’s expert report wouldn’t assist the fact-finder in comprehending the evidence or deciding relevant facts. As a result, it could be excluded on these grounds.

    Even if Johnson’s report had been considered in the Court’s analysis of the Motion for Summary Judgment, it was evident that ACC had not adhered to the rules regarding expert disclosures. Johnson, in his expert report, mentioned reviewing specific documents but revealed in his deposition that he had reviewed additional undisclosed materials, including documents from a Dropbox and his former employer, which ACC had not disclosed in written discovery.

    ACC did not file a motion to exclude Big Sandy’s expert, so the Court dismissed the argument that ACC’s failure to disclose should be excused due to errors made by Big Sandy. The Court highlighted that this wasn’t a substantial justification or a harmless oversight. Additionally, ACC didn’t provide any legal basis or precedent supporting the idea that a Plaintiff must file a motion to compel information from expert reports before seeking relief in a motion to exclude. The Court pointed out that according to Rules 26(a) and 37(c), as well as Sixth Circuit precedent, failure to make proper disclosures could lead to automatic and mandatory exclusion without justification from the non-compliant party.

    Held

    Big Sandy’s motion for summary judgment was granted by the Court on each breach of contract claim. The Court also granted Big Sandy’s motion to exclude the testimony of Bill Johnson. However, the Court decided that the matter of damages will be resolved by subsequent proceedings and no judgment in favor of Big Sandy will be entered until the resolution of the Plaintiff’s claim for damages.

    Key Takeaways:

    The Court found Johnson’s opinions regarding whether the coal was mineable or merchantable to be irrelevant because ACC conceded it was not arguing there were defects with the coal that made it unmineable. Under Kentucky law, profitability is not part of the calculation for whether coal is mineable or merchantable. The Court also found ACC failed to comply with expert disclosure rules under Rule 26(a) by not disclosing all the information Johnson relied on in forming his opinions. ACC did not provide justification for this failure. The Court stated that exclusion of non-disclosed evidence is automatic under Rule 37(c) unless the failure was justified or harmless. Overall, the key takeaways regarding expert testimony are the importance of complying with expert disclosure rules and offering opinions relevant to the specific legal issues in the case. Irrelevant opinions or noncompliance with disclosure requirements can result in exclusion of the expert testimony.